1. Hamilton vs. Jefferson: Balancing Order & Liberty

2. Personal Differences Hamilton Jefferson
Hamilton was born out of wedlock in the British West Indies
Orphaned at an early age
Benefactors provided him with money to study in New York (King’s College – aka, Columbia)
Served as Washington’s aide de camp during the Revolutionary War
Drafted The Federalist Papers with Madison/Jay
First Secretary of the Treasury
Jefferson was born to wealthy parents in Virginia
Had a relatively sheltered upbringing
Studied at William & Mary College
Served in the House of Burgesses and the Continental Congress
Drafted the Declaration of Independence
Served as Ambassador to France in the late 1780s
First Secretary of State

3. Philosophical Differences
Hamilton
Jefferson
Hamilton distrusted the masses, favored government by self-made men (elites)
Believed that America would become an industrial/commercial power
Supported strong central government to preserve order and secure liberties
Argued for “loose” interpretation of the Constitution to give the central government power to deal with challenges
Jefferson placed confidence in the “common man” (to an extent)
Believed that America should be an agrarian republic of “virtuous citizen-farmers”
Distrusted centralized government – favored states’ rights and individual liberties
Argued for “strict” interpretation of the Constitution to limit national power and preserve liberty

4. Economic Policies Hamilton Jefferson
Hamilton’s financial plan aimed to put the country on a firm economic footing
1. Funding of national debt and assumption of state debts
2. Tariffs and excise taxes to provide national revenue and protect “infant” industries
3. Central bank to provide a source of credit and a safe place for federal deposits
Jefferson criticized the plan as a means of consolidating the financial power of the elite
Challenged funding of debt because benefited speculators, not the original purchasers
Considered assumption of state debts as unfair because benefited northern states more
Tariffs and a central bank also tended to help northern, urban interests at the expense of southern, rural Americans

5. The “Compromise of 1790”
Congress refused to pass Hamilton’s assumption plan because of opposition from James Madison and other southerners
Jefferson invited Hamilton and Madison to dinner at his townhouse in New York City and worked out a compromise
Madison would support the assumption bill in exchange for Hamilton’s pledge to support the choice of the Potomac as the site of the nation’s permanent capital
Once an ally of Hamilton in the ratification debate, Madison distrusted Hamilton’s views on executive power

6. Foreign Policy Hamilton Jefferson
Hamiltonian Federalists distrusted the radicalism of the French Revolution and sought to emulate the British system of strong banks and commerce
Washington declared formal neutrality in 1793 to avoid involvement in European crisis
Supported the Jay Treaty (1794), which made concessions to Britain on trade issues but also avoided war
Jeffersonian Republicans embraced the French Revolution and argued the U.S. should remain loyal to its ally
Jefferson officially supported neutrality but was attacked for his continued support of revolutionary France, he resigned from GW’s cabinet in 1793
Republicans criticized the Jay Treaty as a “sell out” to the British

7. Use of National Power: The Whiskey Rebellion
Western Pennsylvania farmers rebelled against high excise taxes on whiskey in 1794
Washington responded by calling out the military to put down the rebellion
Federalists argued that national power must be asserted to demonstrate the new country’s stability and to make the point that challenges to government policy must be peaceful
Washington led 15,000 militia into western Pennsylvania, the only time that a sitting president has led his troops into military action

8. Washington’s Farewell Address
Washington warned against both factionalism and “foreign entanglements” in his last published address as president (1796)
He was especially concerned that the emerging split between Federalists (led by John Adams and Hamilton) and Republicans (led by Jefferson and Madison) would split the country apart along sectional lines
The election of 1796 was the first two-party election in U.S. history; Adams won but Jefferson became vice-president

9. Quasi War & Alien and Sedition Acts
By 1797, the French intercepted American vessels seeking to trade with Britain
“XYZ Affair” – American officials sent to negotiate with the French were expected to pay a bribe
American outrage led to an undeclared naval war with France (the Quasi-War)
The Federalist-controlled Congress cracked down on dissent with the Alien & Sedition Acts (1798)

10. States’ Rights & the “Revolution” of 1800
Jefferson and the Republicans responded with charges that the Federalists were abusing individual liberties under the First Amendment
Madison & Jefferson drafted the Kentucky & Virginia Resolutions, which argued that states had the power of both interposition and nullification (the heart of states’ rights doctrine) to defend the rights of the people
Republicans used the issue to help win the election of 1800 (first peaceful transfer of political power between parties in American history)